Hinduja Group flagship company Ashok Leyland and Nissan Motor have now legally formed three Indian JV companies for light commercial vehicle manufacturing, powertrain production and technology development.

This followed the signing of the master co-operation agreement between the two companies last October.

Ashok Leyland Nissan Vehicles will be owned 51% by Ashok Leyland and 49% by Nissan; Nissan Ashok Leyland Powertrain will be owned 51% by Nissan and 49% by Ashok Leyland and Nissan Ashok Leyland Technologies will be owned 50/50.

The aggregate investment in all three companies will be around INR23bn (about US$575m). Initial capacity will be 100,000 vehicles in the first phase, to be scaled up after production starts around 2010/11.

The initial three platforms, covering applications up to 7.5 tons gross vehicle weight, include a new Nissan Atlas F24 light-duty truck. A new engine also is being developed specifically for LCV applications, as part of a range of Euro 3- and Euro 4-compliant diesel engines.

Ashok Leyland managing director R Seshasayee said: “The current growth plans of Ashok Leyland involve, not only our stated capacity additions and new product launches but also, with this important step, our entry into the fast-growing LCV segment. The balanced JV structure facilitates meaningful contribution from both partners and the best opportunity to leverage their respective strengths.”

Hinduja Group is an investment and banking group founded in 1914. Ashok Leyland is a leading manufacturer of commercial vehicles in India with 07-08 turnover of more than $2bn. It has six manufacturing locations at Chennai, Hosur (three plants), Alwar and Bhandara, annual production capacity of 84,000 vehicles with an additional 100,000 planned by 2010.

It also has associate companies in the Czech Republic and the UAE and joint ventures in Sri Lanka and Bangladesh, and exports to about 20 countries worldwide.